Is This the End of Cheap Stuff in America?

Something strange is brewing in the realm of sustainable fashion.

President Donald Trump’s tariffs have created chaos for fashion companies, disrupting supply chains and resulting in a plummet in the volume of imports entering the US. But one of the most immediate effects of his trade policy has been a dramatic fall in sales at Chinese fast fashion giants Shein and Temu as a result of the de minimis ban, removing the tax exemption that once enabled billions of dollars worth of low-value purchases flowing into the country.

Shein saw a 23 percent decline in sales during the last week of April ending May 1, according to Bloomberg data, while Temu sales fell by 17 percent. The pullback came right after the two companies announced they’d be raising prices to account for higher duties.

With the de minimis ban, on top of the 145 percent tariff on Chinese-made goods and potential double-digit duties on imports from countries like Vietnam and Cambodia, where a significant portion of global apparel manufacturing takes place, it’s almost certain that apparel prices will continue to rise across the board in the coming months.

Already on social media, young consumers are rallying around the idea of a “no buy” 2025, part responsible budgeting but also in no small part anticipation of tariffs-induced inflation.

It seems that Trump’s protectionist ideology may be ushering in an era of conscious consumption that in many ways looks much like the ethos called for by sustainable fashion advocates for years. Just last week, Trump told an NBC reporter, in response to a question about whether an inventory crisis is imminent in the US, that American children “don’t need to have 30 dolls. They can have three.”

Scott Bessent, Trump’s treasury secretary, is also talking like an eco warrior.

“Access to cheap goods is not the essence of the American dream,” he said in a March speech in defense of the tariffs.

Their support for conscious consumption may seem at odds with Trump’s actions elsewhere dismantling environmental initiatives aimed at curbing climate change. But some sustainability experts are coming around to the idea of an unlikely win in alignment with a political foe.

“This is a moment for pragmatism,” wrote Amy Chan, the chief sustainability officer of University of California Berkeley’s business school in an opinion piece published in the Wall Street Journal this week. “Mr. Trump’s trade policies might do more for the planet than a thousand environmental, social and governance reports.”

Still, it remains to be seen whether a pullback for Shein and Temu signals a wider and persistent slowdown in fast fashion. Some observers say the fall of these ultra-cheap players will be an opportunity for the likes of H&M and Zara, whose complex supply chains lend them a greater defense against tariffs.

What’s more, being forced to buy less due to economic constraints doesn’t amount to a permanent mindset shift. Historically, periods of financial austerity are often followed by a culture of excess and opulence: think Christian Dior’s post-war, anti-utilitarian New Look, or the power suits and jewel tones of the 1980s following stagflation and an oil crisis in the ‘70s. More recently, the “revenge shopping” trend coming out of the pandemic fuelled recording-breaking sales for all kinds of brands and retailers.

When it comes to long-term climate action, consumer behaviour can only count for so much. What’s missing are laws and regulations that explicitly incentivise cleaner fashion production. That’s not to mention, tariffs could likely reverse the economic gains made by developing countries such as Bangladesh, which has relied on manufacturing as a means of lifting people out of poverty in recent decades.

“On one hand, people consuming less is always a good thing,” said Sonya Abrego, a fashion historian and professor at FIT and Parsons. “Where it’s troubling is that [higher prices] are forcing people to consume what alternatives? Are they paying more for better clothes? Clothes made under more ethical, sustainable conditions? That’s not a requirement of the tariffs. It’s forcing a reduction in consumption without anything to fall back on.”

Depending on their staying power, there is a possibility that tariffs could actually break our addiction to fast, cheap seasonal fashion — but only if shopping less becomes a habit over time. If people can adopt a new mindset of quality over quantity, then a slower approach to fashion could persist even after economic restraints are lifted, according to Carolyn Mair, a fashion consultant and author of “The Psychology of Fashion.”

But here is where sustainability activists can step in and help reframe this moment of economic restraint into an opportunity for greater consumer engagement, via events like repair workshops and clothing swaps.

“If shoppers associate the new behaviour with political coercion rather than personal or planetary gain, the change won’t last,” Mair added. “But if advocates step in now to shift the meaning of consumption, they can transform economic hardship into cultural momentum for sustainability.”

THE NEWS IN BRIEF

FASHION, BUSINESS AND THE ECONOMY

Skechers will be acquired by investment firm 3G Capital for $8.2 billion. The transaction, which reflects an evaluation of $63 per share, is expected to close in the upcoming third quarter. Following the announcement, shares of the shoemaker rose 25 percent in early New York trading.

Coach owner Tapestry lifted forecasts on pricier handbags and the low tariff impact. Bolstered by strong demand for the Tabby, Brooklyn and Empire leather handbags in North America and China, Tapestry beat third-quarter analyst expectations and raised its 2025 outlook for the third time this year. Shares subsequently jumped 10 percent.

Puma’s earnings met estimates in a boost for the currently CEO-less brand. The German sportswear brand reported earnings of €76 million ($86 million), down from last year but slightly ahead of analyst expectations. Puma also maintained 2025 earnings targets, but the outlook ignores the potential impact of Trump’s tariffs.

Hugo Boss posted its first-quarter beat and reiterated its 2025 outlook. The German fashion group surpassed expectations and maintained its full-year forecast despite tariff uncertainties. The company posted first-quarter revenue of €999 million ($1.13 billion) with earnings of €61 million, above analysts’ forecast of €974 million with earnings of €50 million.

Golden Goose kickstarted a €480 million bond sale to refinance debt. The luxury footwear brand will sell €480 million ($544 million) of senior secured floating-rate notes, with initial price thoughts in the area of low 400 basis points over the benchmark, to refinance debt.

Italian fashion group OTB is assessing the extent of price hikes in the US. The owner of brands such as Maison Margiela, Jil Sander and Diesel expects to increase prices by 8 to 9 percent overall in the US, CEO Ubaldo Minelli said Monday.

Steven Madden pulled its outlook of nearly 20 percent growth amid a trade war. The shoe retailer retracted its previous 2025 forecast of nearly 20 percent sales and profit growth due to the impact of new tariffs, the latest US company to withdraw or reduce its annual guidance.

Warby Parker reached full profitability and lowered its outlook. The eyeglasses maker’s first-quarter earnings included a $3.5 million net profit, the first since the brand went public in 2021. First-quarter revenue jumped 12 percent YoY to $224 million, due to 11 new store openings. Tariff uncertainty caused the brand to lower its revenue guidance.

Next shares hit a record as UK customers splurged ahead of the summer. The British fast-fashion company now expects £1.08 billion ($1.4 billion) of pretax profit this fiscal year, up from a previous forecast of £1.07 billion. Next shares rose 2 percent in early London trading after it raised its guidance for the second time this year as a rival’s operations were disrupted by a cyber attack.

Pandora trimmed its 2025 profitability guidance and warned of the US tariff impact. The Danish jeweller, whose biggest market is the US, lowered its expected profit margin 0.5 percent to around 24 percent this year. If Trump’s 37 percent tariff on Thailand, where its two factories are located, resumes, Pandora expects a cost impact of 500 million Danish crowns ($137.11 million) this year and subsequently 900 million Danish crowns annually.

Zalando beat its first-quarter sales forecast despite “cautious” consumers. The multi-brand retail platform announced group revenue grew 7.9 percent to €2.42 billion ($2.74 billion) in the first quarter, beating analyst expectations of €2.367 billion.

De Beers is closing its man-made diamond jewellery business. The diamond miner is cementing an earlier decision to stop selling lab-grown stones as jewellery as it doubles down on traditional gems.

Lab-grown leather start-up Faircraft acquired Kering-backed VitroLabs. VitroLabs, whose primary assets are 30 patents that Faircraft said would strengthen its capacity to quickly industrialise, was purchased by Faircraft for an undisclosed sum. The four-year-old French company is aiming to launch a full-scale production plant for lab-grown leather within two years.

THE BUSINESS OF BEAUTY

Coty cut its annual profit forecast. The CoverGirl parent company that makes fragrances and cosmetics for Gucci, Chloé and Calvin Klein expects 2025 per-share profit of 49–50 cents, compared with its prior forecast of 50–52 cents, amid struggles with destocking at US retailers due to weak consumer demand. Shares subsequently fell 2 percent in extended trading.

Kenvue beat estimates on healthcare sales, while beauty lags. Demand for cough-and-cold brands offset weaker sales in its skin-health and beauty segment, which includes brands Aveeno and Neutrogena, sending shares up nearly 5 percent in premarket trade. Annual profit is expected to remain flat YoY due to higher costs from Trump’s tariffs.

Olaplex sales continued to slide. The prestige hair care company’s first-quarter sales declined 1.9 percent to $97 million in the quarter. Olaplex posted net income of $0.5 million, a steep drop from $7.7 million in the same quarter of 2024. Still, Olaplex maintained its full-year guidance and expects net sales between $410 million and $430 million in 2025.

Wonderskin secured a $50 million series A round. The five-year-old UK- and US-based brand known for its TikTok-viral Wonder Blading Lip Stain Masque closed a $50 million series A investment led by VC firm Insight Partners, which is known for its tech and direct-to-consumer brand portfolio that includes Shopify and Quince.

Rite Aid is set to file its second bankruptcy and announced job cuts. The pharmacy chain failed to secure additional capital from lenders to continue operating the business less than a year after completing a restructuring to turn the company around. The company plans to cut jobs at its corporate offices in Pennsylvania.

Thirteen Lune’s partnership with JCPenney ended. Following a challenging year and outstanding payments owed to brands, the shop-in-shop partnership has ended after four years. JCPenney plans to continue working with brands under the Thirteen Lune partnership through its own beauty section.

PEOPLE

Calvin Klein named a new president. PVH Corp. appointed David Savman global brand president of Calvin Klein, replacing Eva Serrano. Savman is currently PVH’s chief supply chain officer and global head of operations. Serrano will remain with the company until the end of the year.

Nike president O’Neill is out in the latest shake-up under the new CEO. The sportswear company will restructure its senior leadership. President of consumer, product and brand Heidi O’Neill will retire and be succeeded by former VP Amy Montagne, among other changes.

Kering shook up leadership at Brioni and Ginori 1735. The French luxury conglomerate appointed Federico Arrigoni, previously deputy chief executive and Asia Pacific president of Saint Laurent, CEO of smaller heritage brand Brioni. The menswear label’s previous leader, Mehdi Benabadji, will now lead the Florence-based porcelain house Ginori 1735.

Reebok named its new head of basketball. Jide Osifeso, founder of the contemporary menswear label Hymne, will oversee all facets of the sportswear brand’s basketball division alongside Shaquille O’Neal and Allen Iverson, the former NBA stars who now serve as president and vice president, respectively, of Reebok’s basketball category.

Hims tapped an Amazon vet to lead operations as the company expands. Former Amazon.com Inc. executive Nader Kabbani will join the telehealth company as it expands into new areas like blood testing, as chief of operations. Kabbani led the launch of Amazon Pharmacy during his almost two-decade tenure at the e-commerce giant.

MEDIA AND TECHNOLOGY

Lucien Pagès merged with AIPR. Pagès’ PR agency Lucien Pagès Communication is forming a joint venture with Adam Iezzi’s London-based agency AIPR. Global design, production and PR giant The Independents, which acquired LPC last December, has backed the deal, whose terms are undisclosed.

Edward Enninful’s EE72 launched a website and 72 Magazine. The former British Vogue editor-in-chief’s new media venture will launch a quarterly print publication and EE72 website, which will cover fashion, beauty, luxury and culture, this September. Simone Olivier, Sarah Harris, Lee Swillingham and Stuart Spalding will also join in editorial roles.

Compiled by Jessica Kwon.